



 
You know that the profit is maximized when the marginal cost (MC) is equal to the marginal revenue (MR) from your earlier question. If P is the price per unit, Q is the number of units sold then the revenue is Q x P. I assume that the cost function given is the total cost for producing Q items. Solve the demand function for P and then form the revenue function Q x P. For each firm find MC and MR, set them equal and solve for Q. Use the demand function to evaluate the price that each firm should charge. Harley  


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